THE BLUE BENCH. Financial Statements. December 31, (Together with Independent Auditors Report)

Transcription

1 Financial Statements (Together with Independent Auditors Report)

2 Table of Contents Page INDEPENDENT AUDITORS REPORT... 1 FINANCIAL STATEMENTS Statement of Financial Position... 2 Statement of Activities... 3 Statement of Functional Expenses... 4 Statement of Cash Flows... 5 Notes to Financial Statements... 6

3 CERTIFIED PUBLIC ACCOUNTANTS INDEPENDENT AUDITORS REPORT To the Board of Directors The Blue Bench Denver, Colorado We have audited the accompanying financial statements of The Blue Bench (a Colorado nonprofit corporation), which comprise the statement of financial position as of December 31, 2015, and the related statements of activities, functional expenses, and cash flows for the year then ended, and the related notes to the financial statements. Management s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditors Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion E. Belleview Ave., Ste. 700 Denver, CO MAIN: FAX: American Institute of Certified Public Accountants Colorado Society of Certified Public Accountants Allinial Global, an association of legally independent firms

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5 Statement of Financial Position (With Summarized Totals for December 31, 2014) ASSETS Assets Cash and cash equivalents $ 22,118 $ 810,498 Beneficial interest in assets held by the Rose Community Foundation 695,821 - Contributions and grants receivable 72,627 41,359 Government contracts receivable 68,781 59,302 Prepaid expenses 17,286 17,757 Rent deposits 9,928 9,928 Net property and equipment 20,797 27,719 Total Assets $ 907,358 $ 966,563 LIABILITIES AND NET ASSETS Liabilities Accounts payable $ 17,907 $ 27,123 Accrued payroll costs 20,100 13,698 Rent payable 23,295 18,226 Total Liabilities 61,302 59,047 Net Assets Unrestricted Operating 383,429 86,157 Board designated - Operating reserve 390, ,000 Total Unrestricted Net Assets 773, ,157 Temporarily restricted 72,627 41,359 Total Net Assets 846, ,516 Total Liabilities and Net Assets $ 907,358 $ 966,563 The accompanying notes are an integral part of the financial statements. -2-

6 Statement of Activities Year Ended (With Summarized Totals for the Year Ended December 31, 2014) Temporarily Unrestricted Restricted Total Total Support and Revenue Contributions $ 904,242 $ 72,627 $ 976,869 $ 700,413 Government contracts 328, , ,439 Foundation grants 67,095-67,095 54,375 Program related revenues 73,212-73,212 55,838 Special events, net of $21,914 and $36,512 of direct expenses 62,487-62,487 25,613 Net investment income (loss) (32,960) - (32,960) 403 Other income ,739 In-Kind 93,488-93,488 85,052 Net assets released from restrictions 41,359 (41,359) - - Total Support and Revenue 1,538,054 31,268 1,569,322 1,293,872 Expenses Program Services: Counseling/Advocacy 751, , ,667 Canvass/Community outreach 379, , ,461 Abuse prevention training 146, ,245 86,994 Total Program Services 1,276,673-1,276,673 1,041,122 Supporting Services: Management and general 113, , ,338 Fundraising 240, , ,430 Total Supporting Services 354, , ,768 Total Expenses 1,630,782-1,630,782 1,344,890 Change in Net Assets from Operations (92,728) 31,268 (61,460) (51,018) Gain on Sale of Building ,721 Change in Net Assets (92,728) 31,268 (61,460) 622,703 NET ASSETS, Beginning of Year 866,157 41, , ,813 NET ASSETS, End of Year $ 773,429 $ 72,627 $ 846,056 $ 907,516 The accompanying notes are an integral part of the financial statements. -3-

7 Statement of Functional Expenses Year Ended (With Summarized Totals for the Year Ended December 31, 2014) Program Services Supporting Services Total Total Canvass/ Abuse Total Management Year Ended Year Ended Counseling/ Community Prevention Program and Fund- December 31, December 31, Advocacy Outreach Training Services General Raising Salaries $ 393,638 $ 46,429 $ 112,965 $ 553,032 $ 75,472 $ 53,257 $ 681,761 $ 640,785 Commissions - field canvass - 230, ,737-98, , ,178 Payroll taxes and benefits 49,023 34,517 14,068 97,608 9,399 18, , ,722 Total Employee Costs 442, , , ,377 84, ,091 1,137, ,685 Office and equipment rent 102,586 15,521 6, ,346 10,197 12, ,477 46,398 Counseling interns (in-kind) 93, , ,488 82,952 All other 26,812 8,043 1,933 36,788 2,062 10,399 49,249 47,873 Professional services 12,097 3,297 1,538 16,932 1,694 23,095 41,721 27,025 Field canvass expenses - 18,399-18,399-8,882 27,281 18,668 Technology 17,622 2, ,439 2,253 2,379 26,071 17,691 Telephone 16, , ,768 14,636 Mileage and vehicles 3,076 8,134 1,597 12, ,524 16,767 7,705 Insurance 6,435 1, ,546 6, ,372 19,330 Education 8,430-4,301 12,731 1,981-14,712 5,507 Supplies 9,816 1, ,869 1,214 1,126 14,209 8,677 Postage 4,638 2, , ,915 9,600 6,897 Staff development 2,358 2, , ,157 6,412 4,516 Printing 1,725 3, , ,394 1,357 Depreciation 3, , ,938 6,922 32,528 Utilities and maintenance ,803 Interest ,832 Contract counselors ,710 In-kind ,100 $ 751,183 $ 379,245 $ 146,245 $ 1,276,673 $ 113,582 $ 240,527 $ 1,630,782 $ 1,344,890 The accompanying notes are an integral part of the financial statements. -4-

8 Statement of Cash Flows Year Ended (With Summarized Totals for the Year Ended December 31, 2014) Cash Flows From Operating Activities Change in net assets $ (61,460) $ 622,703 Adjustments to reconcile net income to net cash provided by (used in) operating activities: Depreciation 6,922 32,528 Net gain on disposition of property and equipment - (673,721) Net decrease in value of beneficial interest in assets held by the Rose Community Foundation 34,179 - (Increase) decrease in: Receivables (40,747) (21,099) Prepaid expenses 471 (10,224) Rent deposits - (9,928) Increase (decrease) in: Accounts payable (9,216) 2,867 Accrued payroll costs 6,402 1,911 Rent payable 5,069 18,226 Net Cash Provided by (Used in) Operating Activities (58,380) (36,737) Cash Flows From Investing Activities Proceeds from sale of property and equipment - 1,106,245 (Purchase of) property and equipment - (28,713) (Purchase of) assets held by the Rose Community Foundation (730,000) - Net Cash Provided by (Used in) Investing Activities (730,000) 1,077,532 Cash Flows From Financing Activities (Repayments) borrowings on line-of-credit, net - (209,096) (Repayment of) capital lease obligations - (21,401) Net Cash Provided by (Used in) Financing Activities - (230,497) Net Change in Cash and Cash Equivalents (788,380) 810,298 CASH AND CASH EQUIVALENTS, beginning of year 810, CASH AND CASH EQUIVALENTS, end of year $ 22,118 $ 810,498 Supplemental Disclosure of Cash Flow Information: Interest paid $ - $ 10,832 The accompanying notes are an integral part of the financial statements. -5-

9 Notes to Financial Statements 1. Organization and Summary of Significant Accounting Policies Organization The Blue Bench (the Organization) was established in The Organization was founded on courage to humbly lead the fight for change by providing prevention, education and comprehensive sexual assault services and support in the Metro-Denver area. The Organization s mission is to eliminate sexual assault and diminish the impact it has on individuals, their loved ones and our community. Since its founding, the Organization has been a catalyst for change helping over 450,000 individuals on their path towards healing and working to put an end to sexual assault through prevention and care. The Organization s commitment to providing high quality, culturally competent, low/no cost services to sexual assault survivors is unmatched and its determination to eliminate sexual violence through public education and advocacy has helped it to become a voice for all survivors, their loved ones, and the community at large. The Organization is the leader in sexual assault response and prevention and is committed to changing the conversation and culture around the topic of sexual assault. In 2015, the staff and volunteers of The Blue Bench responded to 2,161 hotline calls. The Organization provided crises response and/or ongoing case management services to 245 victims and 228 victims participated in individual and group therapy sessions for an average of nine months. The Pathway to Prevention program talked with or presented to over 7,300 youth and community members in The Organization s canvass outreach staff spoke in-person to over 228,000 people in Metro-Denver to educate them about the issue of sexual violence. The Organization is supported primarily through individual contributions, foundation funds and government contracts. It operates the following major programs: Counseling/Advocacy Individual and group counseling for victims of sex assault and rape, serving Metro-Denver s diverse population in three locations. 24-hour crises hotline, in both English and Spanish, offers immediate response to anyone impacted by sexual violence. Canvass/Community Outreach Door-to-door contact to distribute hotline cards and information, and request donations. Abuse Prevention Training and Education Prevention education with age-specific curricula promotes safety awareness and prevention techniques. Safety and Empowerment Skills for Women and Girls teaches self-defense and assertiveness strategies. -6-

10 Notes to Financial Statements 1. Organization and Summary of Significant Accounting Policies (continued) Basis of Accounting The financial statements of the Organization have been prepared utilizing the accrual basis of accounting and accordingly, reflect all significant receivables, payables, and other liabilities. Basis of Presentation The financial statement presentation follows the recommendations of the Financial Accounting Standards Board (FASB) in its Accounting Standards Codification (ASC) , which provides guidance for nonprofit organizations. Under ASC , the Organization is required to report information regarding its financial position and activities according to three classes of net assets: unrestricted, temporarily restricted, and permanently restricted. Unrestricted Net Assets - Accounts for all unrestricted resources over which the Board of Directors has discretionary control to use in carrying on the operations of the Organization in accordance with the limitations of its bylaws. The principal sources of unrestricted resources are grants, contributions, and program related revenues. Decreases in unrestricted resources generally result from expenses incurred for program and supporting services conducted by the Organization. Temporarily Restricted Net Assets - Accounts for those resources currently available for use, but expendable only for operating purposes specified by the donor or grantor. Such resources may originate from gifts, grants, bequests, or other similar sources where the donor has specified the operating purpose for which the funds are to be used. Permanently Restricted Net Assets - Accounts for endowment contributions and investments that are permanently restricted by the donor. The Organization has no permanently restricted assets as of. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Income Taxes The Organization is a nonprofit organization exempt from income tax under Section 501(c)(3) of the Internal Revenue Code and is not a private foundation under Section 509(a) of the Code. Accordingly, donors are entitled to a charitable deduction for their contributions to The Blue Bench. The financial statements do not include a provision for income taxes. -7-

11 Notes to Financial Statements 1. Organization and Summary of Significant Accounting Policies (continued) Income Taxes (continued) The Organization evaluates whether there are any uncertain tax positions taken or expected to be taken in a tax return. During the year ended, the Organization s management evaluated its tax positions to determine the existence of uncertainties, and did not note any matters that would require recognition or which may have an effect on its taxexempt status. Concentration of Credit Risk The Organization maintains bank accounts with creditworthy, high quality financial institutions as determined by management, which are insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000. The Organization from time to time may have amounts on deposit in excess of the insured limits. At, the Organization s cash deposits were below the FDIC insurance limit. The Organization receives virtually all its revenues from public support and government contracts. A significant reduction in the level of such support, if this were to occur, may have an adverse affect on the Organization s programs and activities. Cash and Cash Equivalents For purposes of the statement of cash flows, the Organization considers all highly liquid investments with an initial maturity of three months or less to be cash equivalents. Property and Equipment Property and equipment are stated at cost or at the estimated fair value at the date of donation. Assets are depreciated using the straight-line method over the estimated useful lives of the assets as follows: Leasehold improvements Office equipment Vehicles 7 years 3 to 5 years 3 to 5 years All assets with a useful life of more than one year and a cost of more than $3,000 are capitalized, while maintenance and repairs that do not improve or extend the useful lives of the respective assets are expensed currently. Contributions and Grants Receivable Contributions and grants are recognized when the donor makes a promise to give that is, in substance, unconditional. Conditional promises to give are recognized only when the conditions on which they depend are substantially met and the promises become unconditional. The Organization uses the allowance method to determine uncollectible contributions and grants receivable. The allowance is based on prior years experience and management s analysis of specific receivable balances. At, management deems all contributions and grants receivable collectible, accordingly there is no allowance for uncollectible receivables. -8-

12 Notes to Financial Statements 1. Organization and Summary of Significant Accounting Policies (continued) Recognition of Support and Revenue All contributions are considered available for unrestricted use unless specifically restricted by the donor. Unrestricted gift and grant support is reflected as revenue in the year of receipt. Operating funds restricted by the donor, grantor, or other outside party for particular operating purposes are reported as temporarily restricted support. When a donor restriction expires, that is, when a stipulated time restriction ends or purpose restriction is accomplished, temporarily restricted net assets are reclassified to unrestricted net assets and reported in the statement of activities as net assets released from restrictions. Pledges for support of future operations and fundraising activities are recorded as temporarily restricted support in the year the pledge is made. The Organization s policy is to record contributions whose restrictions are met in the same reporting period as unrestricted contributions. Contributions whose restrictions are not met in the same reporting period are reported as temporarily restricted net assets. Contributed Goods and Services Donated goods are reflected as contributions in the financial statements at their estimated fair values at the date of donation. Contributions of services that create or enhance nonfinancial assets or that require specialized skills and are provided by individuals possessing those skills and would typically need to be purchased if not provided by donation, are recorded at their fair values in the period received. Many individuals volunteer their time and perform a variety of tasks for the Organization. No amounts have been reflected in the financial statements for these donated services because they do not meet the criteria for recognition. Gain on Sale of Building On October 28, 2014, the Organization sold its primary operating facility, consisting of land and a building that the Organization acquired in Gross proceeds from the sale were $1,100,000. The Organization recorded a net gain on the sale of the facility of $673,721. Investment Expenses Expenses relating to investment revenues, including investment management and administrative fees, amounted to $3,296 for 2015, and are included as a reduction in net investment income (loss) in the accompanying Statement of Activities. Functional Allocation of Expenses The costs of providing the various programs and supporting services have been summarized on a functional basis in the statement of activities. Accordingly, certain costs have been allocated among the program and supporting services benefited. Reclassifications Certain amounts reported in the prior year financial statements have been reclassified to conform to the current year presentation. -9-

13 Notes to Financial Statements 1. Organization and Summary of Significant Accounting Policies (continued) Summarized Financial Information The financial statements include certain prior period summarized comparative information in total. Such information does not include sufficient details to constitute a presentation in conformity with accounting principles generally accepted in the United States of America. Accordingly, such information should be read in conjunction with the Organization s financial statements for the year ended December 31, 2014, from which the summarized information was derived. Subsequent Events In accordance with the Subsequent Events Topic of FASB ASC, management is required to evaluate, through the date the financial statements are issued or available to be issued, events or transactions that may require recognition or disclosure in the financial statements, and to disclose the date through which subsequent events were evaluated. The Blue Bench s financial statements were available to be issued on May 10, 2016, and this is the date through which subsequent events were evaluated. 2. Beneficial Interest in Assets held by the Rose Community Foundation In July 2015, the Organization transferred $730,000 to the Rose Community Foundation (the Foundation ). The Foundation commingles these funds with the funds of other entities for investment in order to achieve beneficial economies of scale and provide cost-effective access to professional investment management. The Organization may withdraw all or any portion of the funds in such amounts and manner as deemed appropriate by the Organization. As of, the fair value of the assets held by the Foundation totaled $695,821. In August 2015, the Organization entered into an agreement with the Foundation to establish The Blue Bench Endowment Fund. Under the terms of the agreement, the Foundation agreed to match up to $10,000 of Organization deposits into the fund. The fund is governed by an annual spending (withdrawal) policy, whereby the Foundation will distribute to the Organization an amount not to exceed 5% of the value of the assets in the fund. In February 2016, the Organization made its initial deposit into the endowment by transferring $10,000 from its general operating investments at the Foundation into the Endowment Fund. 3. Property and Equipment At, property and equipment consisted of the following: Description Amount Office Equipment $ 36,271 Leasehold Improvements 13,910 Vehicles 14,724 Total 64,905 Less: Accumulated depreciation 44,108 Total $ 20,

14 Notes to Financial Statements 4. Operating Leases Effective November 1, 2014, the Organization entered into an agreement to lease office space under a non-cancelable operating lease scheduled to expire on December 31, The agreement includes two months of free rent and annual rent increases. In accordance with generally accepted accounting principles, the Organization is recognizing rent expense on a straight-line basis over the term of the lease. As a result of the difference between the calculated straight-line lease expense and cash payments made under the agreement, the Organization has recorded rent payable of $23,295 at. The Organization also leases auxiliary office space and office equipment under operating leases expiring at various times through October Approximate minimum rent payments due under all operating leases are as follows: Year Ending December 31: 2016 $ 132, , , , , ,100 Rent expense under all operating leases totaled $147,477 for In-Kind Contributions $ 722,600 Donated goods and services are reflected in the accompanying financial statements at their estimated values at the date of receipt. Donated goods and services consisted of the following for the year ended : Description Amount Counseling services $ 93,488 No amounts have been reflected in the financial statements for donated services not requiring specific expertise. The Organization generally pays for services requiring specific expertise. However, volunteers donated approximately 20,700 hours of service to the Organization in Restrictions on Net Assets As of, temporarily restricted net assets consisted of the following: Contributions and grants receivable $ 72,

15 Notes to Financial Statements 7. Fair Value Measurements The Organization follows the provisions of the Fair Value Measurements and Disclosure Topic of FASB ASC. This standard requires the use of fair value hierarchy that prioritizes the valuation techniques used to measure fair value into three levels. The three levels of the fair value hierarchy defined in the FASB ASC are as follows: Level 1 Quoted prices are available in active markets for identical assets or liabilities as of the reported date. Level 2 Pricing inputs are other than quoted prices in active markets, which are either directly or indirectly observable as of the reporting date, and fair value is determined through the use of models or other valuation methodologies. Level 3 Pricing inputs are unobservable for the investment and include situations where there is little, if any, market activity for the investment. The inputs into the determination of fair value require significant management judgment or estimation. In determining fair value, the Organization utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible. There were no changes in the valuation techniques used during the year. Following is a description of the valuation methodologies used for assets measured at fair value: Beneficial interest in assets held by the Rose Community Foundation: Represents funds held by the Foundation, the fair value of which is based upon information determined and reported by the Foundation. The fair value of investments held by the Foundation includes Level 1, 2, and 3; however, the Organization s pro rata share of the pooled investments is not quoted in active markets and is, therefore, classified under Level 3 in the fair value hierarchy. The carrying amount reported in the Statement of Financial Position for cash and cash equivalents, accounts receivable, accounts payable, and accrued liabilities approximate fair value because of the immediate or short-term maturities of these financial instruments. In general, investments are exposed to various risks, such as interest rate, credit, and overall market volatility risk. Due to the level of risk associated with certain investments, it is at least reasonably possible that changes in the values of the investments will occur in the near term and that such changes could materially affect the investment balances and the amounts reported in the statement of financial position. -12-

16 Notes to Financial Statements 7. Fair Value Measurements (continued) The following table presents the valuation of the Organization s investments by the above fair value hierarchy levels as of : Fair Value Measurements Using Level 1 Level 2 Level 3 Total Beneficial interest in assets held by the Rose Community Foundation $ - $ - $ 695,821 $ 695,821 The table below sets forth a summary of changes in the fair value of the Organization s Level 3 investment assets for the year ended : Rose Community Foundation Balance as of December 31, 2014 $ - Deposits into the fund 730,000 Realized/unrealized gains (losses), net (30,883) Investment management fees (3,296) Disbursements - Balance as of $ 695,